Deed of inter-company cross guarantee

This document is for use by a company that seeks extra security before entering into a contract with a counter party. It brings in another company or individual to guarantee the performance of the original obligations of the counter party. It can be used for many situations, including but not limited to the guarantee of a debt.

Suitable for use in: England & Wales and Scotland
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About this document

This professionally drawn agreement provides for one or more companies or individuals to act as a guarantor for the obligations of one or more other companies, regardless of the relationship between them.

The guarantor could be a related company (such as a parent or a subsidiary), unrelated (but perhaps having a shareholder in common), or an individual.

The document provides additional, strong legal protection for the lender or party on the other side.

The most common use for a cross guarantee agreement is to provide additional security for a loan. While this agreement is suitable for that purpose, it is also suitable for ensuring the performance of any other contract. For example, it could be used to make sure that an important building project, on which a larger project depends, is completed on time and to specification.

The agreement can be used where one or more of the parties is outside of the UK.

This agreement can be signed as a deed, or as an agreement under hand. Our guidance notes explain how to do both.

Depending on the circumstances, a cross guarantee could be put in place at the same time as the related contract is signed, or as a supplementary agreement at some point after if circumstances change (such as the ownership of either side changes).

We also include optional provisions to vary the terms of the original contract if the circumstances require.

This is a solicitor drawn document that gives strong legal protection.

The law in this document

There is no relevant statute law with respect to the provision of guarantees. This document is based on common law.

Alternative documents

In these examples, the guarantee is for performance of a contract. If you are looking for a cross guarantee agreement for a contract debt only, you should look at our inter-group guarantee for a loan, specifically for that purpose.

Net Lawman also offers other guarantee and indemnity documents that might be of interest.

Application and main features

  • Warranties and interpretation
  • The guarantees
  • Continuing liability
  • Changed terms of original agreement
  • Lender’s right to assign
  • Rights waived
  • Other necessary legal provisions
Draftsman

This document was written by a solicitor for Net Lawman. It complies with current English law.

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